July 6, 2020

Amendment Seeks to Shift Beneficial Owners Reporting Responsible to Small Businesses

FEDA has signed on to a letter to Senate leaders opposing an amendment that would impose burdensome reporting on millions of small businesses and threaten privacy laws.

The so-called Crapo-Brown Amendment would require all businesses with 20 or fewer employees to register their “beneficial owners” with the Financial Crimes Enforcement Network (FinCEN) within two to three weeks of enactment and then to update that information regularly for the life of the business. This information would be accessible to law enforcement agencies and officers, including the FBI, CIA, and state attorneys general. This would be a significant change from current rules, which require law enforcement to obtain a subpoena or warrant to access similar data. Failure to provide complete and updated reports could result in penalties of up to $10,000 and two years in prison.

Businesses with more than 20 employees and $5 million in sales would be exempt from this regulation.

The amendment attempts to shift the reporting requirements from large banks to small businesses that are not as well-equipped to handle the additional workload.

The read the full letter to Senate leaders, please click here.